Embarking on a property purchase in Portugal is an exciting journey filled with opportunities. ACPS Real Estate, under the guidance of Calvin Gibson, ensures a transparent and informed process, especially when it comes to understanding the associated costs. Here's what you need to know about the fees and taxes involved in securing your dream Portuguese property.
Understanding Stamp Duty and Notary Fees
Upon completing your property purchase, you will encounter a stamp duty fee payable to the public notary, calculated at 0.8% of the property's declared value. Should you opt for a mortgage in Portugal, an additional 0.6% stamp duty applies to the mortgage's value. Notary and land registration fees, facilitated by your legal representative, are also based on the declared value of your property at completion.
Council Tax (IMI)
As a property owner in Portugal, you're responsible for the annual council tax (IMI), which varies depending on the type of land. Rustic land incurs a 0.8% tax, while urban property is taxed between 0.3% and 0.5%, depending on the local council's rates.
Timeline for the Purchase Process
The signing of the promissory contract typically occurs within 2 to 4 weeks, provided all property documentation is up to date. Both parties agree on completion dates before signing this contract, establishing the sale's terms and conditions.
Portuguese Property Transfer Tax (IMT)
IMT is a significant expense for buyers, with rates based on the property's price. Your lawyer will provide detailed advice on these costs early in the purchase process.
Detailed IMT Rates for Permanent Residence and Second Homes
The IMT varies based on whether the property is a permanent residence or a second home, with specific rates applied according to the property's value:
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Permanent Residence IMT Rates:
- Up to €92,407: 0%
- €92,407 - €126,403: 2% (Minus €1,848.14)
- €126,403 - €172,348: 5% (Minus €5,640.23)
- €172,348 - €287,213: 7% (Minus €9,087.19)
- €287,213 - €550,836: 8% (Minus €11,959.32)
- Over €550,836: 6% Flat Rate
- Over €1,000,000: 7.5% Single Rate
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Second Home IMT Rates:
- Up to €92,407: 1%
- €92,407 - €126,403: 2% (Minus €924.07)
- €126,403 - €172,348: 5% (Minus €4,716.16)
- €172,348 - €287,213: 7% (Minus €8,163.12)
- €287,213 - €550,836: 8% (Minus €11,035.25)
- Over €550,836: 6% Flat Rate
- Over €1,000,000: 7.5% Single Rate
Notary, Stamp Duty, and Registration Fees
Finalising the purchase involves paying notary, stamp duty, and registration fees, with stamp duty set at a standard rate of 0.8% of the property price. These fees ensure the legal acknowledgment of your property purchase.
With ACPS Real Estate's expertise, navigating the financial landscape of purchasing property in Portugal becomes straightforward, allowing you to focus on the excitement of your new investment. Our commitment is to provide clarity and support throughout this process, ensuring a seamless transition into your new Portuguese home or investment property.
